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Crude oil futures decline after IEA cuts demand outlook

Published 04/11/2013, 10:01 AM
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Investing.com - Crude oil futures were lower during U.S. morning hours on Thursday, retreating from a one-week high after the International Energy Agency cut its global oil demand forecast for 2013 for the third consecutive month.

On the New York Mercantile Exchange, light sweet crude futures for delivery in May traded at USD94.21 a barrel during U.S. morning trade, down 0.45% on the day.

New York-traded oil prices fell by as much as 0.6% earlier in the session to hit a daily low of USD93.98 a barrel. Nymex oil prices rose to a one-week high of USD94.81 a barrel on Wednesday.

The IEA reduced its estimate for global oil demand by 45,000 barrels a day in 2013 to 795,000 barrels a day.

The agency also predicted the weakest demand in Europe since the 1980s.

The IEA forecast comes one day after the Organization of the Petroleum Exporting Countries cut its global oil demand estimate for the second time in two months on Wednesday.

OPEC lowered its world oil-demand growth forecast by 40,000 barrels a day to 800,000 barrels in 2013.

Concerns over the energy demand outlook in the U.S. were also in focus after a U.S. government report on Wednesday showed oil supplies rose to the highest level since July 1990 last week.

U.S. crude oil inventories increased by 0.3 million barrels last week to hit 388.9 million, dampening hopes of a robust recovery in oil demand from the world’s largest oil consumer.

Oil prices remained lower despite a report showing that U.S. initial jobless claims fell more than expected last week.

The Department of Labor said the number of people who filed for unemployment assistance in the U.S. fell by 42,000 to a seasonally adjusted 346,000, last week compared to expectations for a decrease of 23,000.

Elsewhere, on the ICE Futures Exchange, Brent oil futures for May delivery lost 0.65% to trade at USD105.09 a barrel, with the spread between the Brent and crude contracts standing at USD10.88 a barrel, the lowest gap since June.

The spread between the two contracts continued to trade at a nine-month low, due to an improving production outlook in the North Sea and amid growing concerns over the euro zone’s economic outlook.

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